Companies argue in favor of merger in 327-page filing
Comcast and NBC Universal say their planned union would stimulate, not stifle competition, pushing back in a rebuttal filed Wednesday against critics who are raising a host of fears that the deal will dramatically alter the media landscape.
In a 327-page filing that marked the latest milestone as they seek approval from the FCC, the two companies even argued that many of the arguments against the joint venture were “contrived efforts” as well as “self-serving claims of various competitors and the predictable responses from certain familiar critics.”
In a rebuttal to critics of the merger filed with the FCC, the companies said the transaction “will not diminish competition in any relevant market.”
Competitors like DirecTV, Dish Network and Bloomberg and public interest groups like Public Knowledge and Free Press have raised an array of concerns about the joint venture, but Comcast and NBC U argue that many of their arguments should be part of industrywide proceedings, and not specific to their deal.
For example, Comcast and NBC U suggested that Dish Network, AOL and Public Knowledge are using the process to push the idea of imposing ‘Net neutrality regulations, even though proposed rules mandating equal treatment for all Internet content are going through a separate process of FCC review.
Comcast and NBC U also said the same was true for rules mandating access and carriage of cable programming, and that other concerns over such things as labor grievances and or cable TV regulation were “unrelated issues.”
“The commission’s precedents rightly require a focus on transaction specific issues,” the companies said. “From those who argue that there are any such issues, the commission should demand facts, logic and rational argument, not the hyperbole, speculation, and even character assassination that several opponents employ.”
The filing spells out many of the arguments Comcast and NBC U already have made, particularly when it comes to competition. It says the new entity will have about 12% of total advertising and affiliate revenues for national cable networks, behind Disney, Time Warner and Viacom. But it also cites a number of orgs and individualsthat have expressed support, ranging from the Directors Guild of America to Al Sharpton.
Many of the concerns over the transaction have cited Web video, as it will combine a major content creator with the country’s largest cable operator and Internet provider. Comcast and NBC U argued the new entity won’t threaten competition, as online video is a “nascent marketplace that is dynamic, vibrant and competitive — and will become even more so as a result of this transaction.”
Nevertheless, critics also weighed in with fresh arguments against the transaction.
The Writers Guild of America, West dismissed a recent agreement that Comcast and NBC U reached with the Independent Film & Television Alliance as not going “far enough.” The agreement calls for the companies to increase pitch and development meetings with independent producers, as well as to spend $1.5 million on development with the creators unaffiliated with the company or other major studios. But the WGA noted that the agreement still “does not provide a guarantee that any amount of independently produced programming will be aired on these channels.”
And in a filing that seemed in direct contradiction to Comcast and NBC U, the American Cable Assn., representing small- and medium-sized cable operators, argued the companies would have “enhanced market power” with the “incentive and ability” to raise the costs of carrying the most desired cable channels. The costs, the cable association said, would be passed on to the consumer.